Is Homeowners Insurance Required? What You Need to Know About Your Coverage
When it’s freezing cold with blizzard conditions, you probably wouldn’t go outside without a hat and coat. Noone’s going to force you to wear them. It just makes sense to stay protected.
Think of homeowners insurance in a similar way. It’s there to protect you and your home. Is homeowners insurance required by law? Here’s what you need to know.
Homeowners Insurance and Lenders
Homeowners insurance differs from car insurance because it isn’t a legal requirement. But, if your home is mortgaged, your lender will almost always want proof that you at least have a basic homeowners insurance policy.
Why? It’s all about risk. If your bank is lending you money, it needs to be sure the asset you’re buying is protected. Should something happen to your home then they’ll want the security of knowing that you’ll be able to take care of things.
For many people, their home is an investment as well as a place to live. It makes sense to make sure that you’ll be covered in case of theft or fire, for example.
That said, not all homeowners insurance policies are equal. It’s very important to sit down and make a list of the things you’d like to be covered for. Check the small print to make sure your policy meets your needs.
Insurers will usually cover your home against fire, certain weather disasters, theft, and vandalism. This would then allow you to get the house repaired or rebuilt.
Remember that maintenance repairs would not normally be covered. So, if your drains get blocked or, if some roof tiles need replacing due to wear and tear, you’d need to pay for these yourself.
If the area you’re living in is prone to flooding then you may need additional insurance. You should also check to see if extra structures like garages and their contents would be covered.
A basic policy should cover you and those who live in your home against liability. Let’s say someone stumbles and injures themselves in your house. They could well sue. Liability insurance would protect you against the costs involved.
Most policies will have deductibles. That means you would have to pay a certain amount of any claim. You should always check to see what these amounts are. The higher the deductible the cheaper the policy tends to be.
It’s wise to ensure that your personal possessions are covered by homeowners insurance. If you have something very valuable then you will more than likely have to declare it when you take out the policy.
It’s a good idea to photograph your possessions and keep any receipts so that you have a record in case you need to make a claim. Some policies will cover things like bikes and laptops if they’re lost or stolen when you’re outside the home.
Is Homeowners Insurance Required?
Your home should be your safe haven. Is homeowners insurance required? If you want to sleep better at night then the simple answer is, ‘Yes.’ You’ll be safe in the knowledge that your home is protected should anything untoward happen.
Continue reading our blog for more homeowner tips about how often to replace your roof and energy solutions for those who want to stay green.